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Getting to Know: Drones

Motorists Insurance Group’s Vice President and Chief Claims Officer Teresa King explains how the FAA’s decision to grant commercial companies permission to use drones could affect the claims industry.

June 24, 2015 Photo

On why drones have piqued her interests:  

“There are lots of technologies that I think are interesting, but drone technology is really fascinating. It’s great for catastrophes because you can do flyovers and get into buildings that you wouldn’t otherwise be able to inspect, and we get detailed images and videos of the damages. We even had a drone demonstration at our building last year. They circled the building, and you could see the faces of everyone standing outside in great detail.”

On how insurers may adopt and implement drone technology:

“We do expect to see development in drone technology now that the Federal Aviation Administration (FAA) has granted limited approval. We have partnered with several companies that are on the forefront of this technology, and we see the potential for even greater development moving forward. 

“While the current technology is great, we have seen limited usefulness for daily claims thus far. Our usage to date has been limited to assessing roofs that have limited access. We view the greatest potential for this technology is during post-catastrophe event evaluation by utilizing fixed-wing drones that can survey a large area. We doubt this is something that we would take on ourselves, as the costs associated with each event would outweigh the benefits. We likely will remain consumers of the data from a vendor that is able to scale the costs of the technology to multiple partners.”

On the kinds of scenarios for which drones might be used:

“Residential and commercial roof claims and post-catastrophe response seem to be the best fit for drone usage. We can see some application for commercial structures that may be unsafe to enter or difficult to inspect based on location, damages, or conditions.

“However, we see the usefulness of this technology reaching beyond claims and into risk management and underwriting. Roof and building surveys on large commercial properties could be much more accurate with this technology. As I understand it, some larger insurers already have invested in drone technologies.”

On the risks associated with using drones:

“We see several risks associated with drone usage. Drones are heavy, have short battery lives, and have propellers that spin at a high rate of speed. This can be a dangerous combination that can cause injury or property damage under the use of someone who is untrained.

“Additionally, there are privacy concerns with this technology, especially when used in residential areas with neighboring properties. For these reasons, we have concerns with using drones at the field level. There would also be time and costs associated with appropriate training and certification to man and operate this type of sophisticated equipment.”

On the vetting process of drone service providers:

“We already have a process of vetting vendors when we want to use this technology on our claims. We make sure they have specific unmanned aerial vehicle (UAV) insurance coverage; we ask them to indemnify us in the event of an injury, property damage, or privacy claim; and we require a signed disclosure of the usage from the property owner. Additionally, we make sure to verify FAA qualifications.”  

About The Authors
Eric Gilkey

Eric Gilkey is vice president of content at the CLM, and serves as executive editor of CLM magazine, the flagship publication of the CLM.  eric.gilkey@theclm.org

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